Wednesday, May 22, 2024
HomeFinanceOMV Petrom notes significant net profit drop amid production cuts

OMV Petrom notes significant net profit drop amid production cuts

Romanian energy company OMV Petrom announced on Thursday (1 February) that its net profits in 2023 decreased to 4.03 billion Romanian lei (812 million euros) from 10.3 billion lei (2.1 billion euros) in 2022, noting a drop of 61 per cent in comparison to the previous financial year.

The company’s annual sales revenues also dropped by 37 per cent, from 61,344 billion lei (12.3 billion euros) to 38,808 billion lei (7.8 billion lei). This drop can largely be attributed to lower commodity prices and lower electricity sales, OMV Petrom said during a press conference on Thursday.

As noted by the company, Romania’s power and gas demand last year continued to decrease despite an increase in the country’s economic activity, with a -5 and -6 per cent drop, respectively. In comparison to 2021, power demand in 2022 was 8 per cent lower while gas demand was 16 per cent lower.

In 2023, OMV Petrom’s oil and gas production decreased by 6.8 per cent, predominantly, due to natural decline and planned maintenance activities, partly offset by the contribution of work-overs and new wells, the company said.

Additionally, the company said that production cost increased by 33 per cent to 17.8 US dollars (16,57 euros)/barrel of oil equivalent (boe), mainly due to cost inflation, lower production available for sale and unfavourable oil futures (FX)

“2023 was an outstanding year for the execution of OMV Petrom’s 2030 Strategy, and the resilience of our operating model was once again in evidence. Despite challenging macro headwinds, our Neptun Deep project entered its development phase and we expanded our green projects portfolio,” said Christina Verchere, CEO of OMV Petrom. “For the upcoming period of 3 years, we plan to invest an annual average of approximately 8 bn lei. This is more than double from the average 3.5 bn lei for the period 2017 to 2021, before we launched our Strategy 2030.”

OMV Petrom secured over 80% of the execution agreements required for Neptun Deep

In 2024, the company aims to increase its investment expenditure to around 8 billion lei (1.61 billion euros), with Neptun Deep and low/zero emission projects, including sustainable aviation fuels, renewables and EVs, set to be the main beneficiaries of the spending increase.

Sign up for our newsletters

    Monthly newsletter – Delivering the most important energy stories of the month selected by our Editor-in-chief
    Weekly Oil&Gas roundup - All major news about the oil and gas industry, LNG developments, the upscaling of new gases and related EU regulations arriving in your mailbox every Monday.
    Weekly Renewables&Climate roundup - All major news about investments in renewable energy sources, environment protection, green hydrogen and new innovative ways to tackle the climate crisis arriving in your mailbox every Tuesday.

    Most Popular